Over a thousand restaurants have de-listed themselves from food delivery and dine-in aggregators like Zomato, Swiggy, EazyDiner, stating that the deep discounts being offered by the aggregators were hurting their business models. The campaign, called #Logout, is being led by the NRAI (National Restaurants Authority of India) and is centred around the problems that restaurants are facing due to offers given by aggregators to their members. These include deep discounts, free drinks and dishes (Zomato Gold), all you can eat offers, and others which the restaurants claim are unsustainable and promote a culture of “discount addiction” amongst customers.
By August 15, 1800 restaurants had delisted themselves from their aggregators they had tied up with. After a meeting between both parties, the aggregators have decided to tone down the offers and make them more favourable to the restaurants.
“It was decided that all aggregators will rejig their features, which will allow the restaurant-customer ecosystem to detox from the addiction of deep-discounts that have crippled the industry,” said Rahul Singh, President, NRAI, in a statement. “Discounting is a privilege and not a right. The idea of scoring a discount should make guests feel special and not give them a sense of beating the system.”
In a series of tweets, Zomato’s founder and CEO Deepinder Goyal said, “Somewhere, we have made mistakes and things haven’t gone as planned. This is a wake-up call that we need to do 100x more for our restaurant partners than we have done before. We are committed to work with the industry and make modifications to Zomato Gold which will result in a win-win situation for restaurants and consumers. Just like last year, when we changed some rules around Gold after hearing about the concerns of the restaurant community.”. He also added that restaurants should consider ways to reduce their own operating costs so that eating out becomes more affordable and concluded by saying, “What’s good for restaurants is good for Zomato. What’s good for consumers is good for Zomato. Finding the right balance and product-market fit is the restaurant industry’s problem (and that includes us).”
Image Source – BW Disrupt